Santosh Bagrodia (right) with Bengal power minister Mrinal Banerjee (left) in Calcutta on Tuesday. Picture by Kishor Roy Chowdhury

Calcutta, Jan. 20: Coal India may be forced to raise prices next year to partially meet an increased wage bill.

The government will sign a new wage pact with Coal India employees on January 24.

“The revised wages for workmen and officers will put an additional burden of Rs 5,000 crore on Coal India,” Union minister of state for coal Santosh Bagrodia said here today.

“Following this, Coal India may have to increase its prices,” the minister said, while speaking to reporters on the sidelines of an energy seminar organised by the Indian Chamber of Commerce here today.

However, the rates won’t be increased this year. “Any increase in coal prices will come in 2010,” he said.

Coal India had increased prices by 10 per cent in December 2008 after a gap of three--and-a-half years.

The company had also proposed to peg the floor price under the e-auction mode at 40 per cent premium above the notified price (a price at which Coal India supplies coal to power sector companies).

But Bagrodia withdrew this premium and set the e-auction floor price back at the notified price in June last year.

The eighth national wage settlement for Coal India employees will be effective retrospectively — from July 2006 for workmen and from January 2007 for officers.

Coal India has more than five lakh non-executive employees. Under the new wage agreement (agreed for five years) workmen will get a 24 per cent salary hike.